Customer award programs are implemented by many different organizations as a means to create loyalty and enhance customer activity. One example of such a customer awards program exists in the credit card industry where customers obtain points for card usage. The points are then redeemable through some means for specific products or awards of cash or credit.
Other awards programs in the credit card field are based on either the individual customer's annual card usage—resulting in a year-end reimbursement—or a specific purchase made with the card—resulting in a free purchase. In sum, these systems offer a customer (1) a fixed return based directly on the customer's purchases, (2) fixed redeemable “points”, or (3) a chance to have the credit card company cover the costs of a particular card transaction, or specified set of transactions. Alternatively, some other industries may provide rewards based on customers' continued purchases or activity. For instance, it is common for airlines to award “miles” to its customers as a reward for flying, such that the miles are redeemable for free or discounted travel services. Similarly, retail stores may award points to members of a loyalty program for their purchases, where the points may be used for products at the store.
All of these programs are based on the customers' personal transactions; i.e., the amount “awarded” is based on each individual customer's purchases. For instance, an individual's credit card may reimburse 0.5% of his or her purchases at the end of the year through cash/credit/points. Likewise, customers receive the points or miles as described above based on each customer's individual activity.
None of these programs provide customers with the opportunity to win amounts greater than what has been spent on an individual basis. Thus, customers are not provided with the anticipation or excitement of possibly being awarded substantial prizes or amounts greater than their own purchases. While customers may appreciate the existence of current programs, they do not have incentives to increase their activity with the organizations offering the award program.
Similarly, other reward systems may offer customers a single month wherein any purchase—if made at a precise moment—could be free. However, although these programs provide a potential benefit to customers, the programs do not create excitement that would motivate customers to make additional purchases merely for the chance to win the award because the likelihood of winning is largely attenuated.
There is therefore a need for a system and method for rewarding customers in a manner that creates the possibility of receiving not just a fixed percentage of their personal transactions, but of winning a substantially greater reward. There is also a need for a system and method for rewarding customers that occurs at frequent, regular intervals, not just annual, seasonal, or ad hoc periods. In particular, there is a need for a system and method for administration of a rewards program that generates excitement and “buzz” by offering customers regular opportunities to win award values greater than each individual customer's transactions. The present invention is directed toward meeting these needs.